Evaluations for input

A recent study of inflationary expectations has revealed that the consensus among economic forecasters yields the following average annual rates of inflation expected over the periods noted. (Note: Assume that the risk that future interest rate movements will affect longer maturities more than shorter maturities is zero; that is, assume that there is no maturity risk.) <image 1> If the real rate of interest is currently 2.5%, find the nominal rate of interest on the following U.S. Treasury issues: 3-month bill

(A) 7.5%

(B) 8.5%

(C) 10.5%

(D) 11.5%

Answer with the option's letter from the given choices directly. No punctuation.